Wage Differentials in Mexico: an education and economic activity perspective

Author: Rogelio Varela Llamas y José Urciaga García
Abstract: This paper analyzes the determinants
for breadwinners´ wage levels in
Mexico through a labor perspective
that integrates elements of human capital,
sector of economic activity, establishment
size, territory, as well as other attributes
such as gender and type of job contract. We
used the Heckman methodology to correct
the self-selection bias, while using microdata
from Mexico´s 2008 National Survey of
Household Income and Expenditures. The
results indicate that human capital allocation
is a variable that explains breadwinners´
income increase. From the demand
side, it is noted that establishment size also
affects income. Individuals who have long
term contracts and seniority perceive higher
incomes than those who do not enjoy the
same employment status.
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